Bass, Berry & Sims attorney Meredith Collins authored an article for McKnight’s Home Care examining the compounding regulatory and financial challenges that post-acute care providers are facing in 2026.
Meredith examined the impact of the One Big Beautiful Bill Act (OBBBA), which the Congressional Budget Office (CBO) projects will result in approximately $911 billion in net Medicaid cuts between 2025 and 2034. “The law impacts home care funding from multiple angles, imposing new work requirements, requiring biannual eligibility redetermination, and increasing administrative burden,” she said.
The OBBBA bans new or increased provider taxes and phases down the “safe harbor” tax cap from 6% to 3.5% by 2032, reducing federal matching funds by an estimated $183 billion. These constraints are projected to create reimbursement shortfalls of 3% to 7% for 2026 to 2027, widening the gap between what providers need to operate and what states are able to pay.
Meredith also addressed the unresolved status of the 80/20 provision in the Ensuring Access to Medicaid Services Rule. In February 2026, the Centers for Medicare and Medicaid Services (CMS) confirmed an 18-month deferral in the enforcement of certain Access Rule provisions. “Nevertheless, nothing has been formally rescinded, and the provision was not included in OBBBA because CBO concluded its repeal would not save money. Agencies remain in regulatory limbo, unable to plan with certainty,” she highlighted.
Meredith analyzed the growing audit risk home health providers face under the Patient-Driven Groupings Model (PDGM), noting that documentation accuracy is not the front line of financial survival. “Providers must align functional scoring, diagnosis coding and narrative documentation so that clinical records tell a coherent, defensible story before claim submission,” Meredith emphasized.
“To navigate these challenges, agencies must prioritize proactive compliance, maintain rigorous documentation practices, and build operational flexibility to adapt to shifting reimbursement landscapes,” Meredith said.
The full article, “Home care providers under pressure: Navigating Medicaid and Medicare risks,” was published by McKnight’s Home Care on June 18 and is available online.